Petrowest Corporation Announces $7.5 Million Bought Deal Offering

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TORONTO, Oct. 3, 2012 /CNW/ - Petrowest Corporation (the "Company") is pleased to announce that it has entered into an agreement with a syndicate of underwriters led by Beacon Securities Limited (collectively, the "Underwriters"), which have agreed to purchase, on a "bought deal" basis 15,000,000 common shares (the "Common Shares") of the Company at a price of $0.50 per Common Share, for aggregate gross proceeds of $7,500,000.  The Company has also granted the Underwriters an over-allotment option, exercisable by the Underwriters in whole or in part at any time on or up to 30 days after the closing of the offering, to purchase up to an additional 2,250,000 Common Shares. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the offering will be $8.625 million.

The Company plans to use the net proceeds from the offering for repayment of corporate indebtedness and for general working capital purposes.

The offering is scheduled to close on or about October 24, 2012 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

The Common Shares will be offered by way of a short form prospectus to be filed in all of the provinces of Canada (other than the Province of Quebec) pursuant to National Instrument 44-101 Short Form Prospectus Distributions and in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended.

This press release is not an offer or a solicitation of an offer of securities for sale in the United States.  The Common Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration.

FORWARD-LOOKING INFORMATION

Certain of the statements made and information contained herein, including the use of proceeds,  is "forward-looking information" within the meaning of applicable Canadian securities legislation or "forward-looking statements" within the meaning of the Securities Exchange Act of 1934 of the United States. Generally, these forward-looking statements or information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".  Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements, including, without limitation, risks and uncertainties relating to foreign currency fluctuations; the potential for and effects of labor disputes or other unanticipated difficulties with or shortages of labour or interruptions in operations; the inherent uncertainty of operations and cost estimates and the potential for unexpected costs and expenses, price fluctuations; uncertain political and economic environments; changes in laws or policies, taxation, delays or the inability to obtain necessary governmental permits; and other risks and uncertainties, including those described under risk factors in the Company's current Annual Information Form and management discussion and analysis. Should one or more of these risks and uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements. The forward-looking information contained herein is presently for the purpose of assisting investors in understanding the Company's plans and objectives and may not be appropriate for other purposes.  Accordingly, readers are advised not to place undue reliance on forward-looking statements.

ABOUT PETROWEST

Petrowest is an Alberta corporation involved in pre-drilling and post-completion energy services as well as industrial and civil infrastructure projects, gravel crushing and hauling for non-energy sector customers.  Petrowest's primary operations are based in the Grande Prairie area of northern Alberta and in northeastern British Columbia.

SOURCE: Petrowest Corporation

please contact Richard Quigley, President and Chief Executive Officer, or Ian Hogg, Vice President, Corporate Affairs, at (780) 830‐0881, or Lloyd Wiggins, Chief Financial Officer, at [phone], or [email protected].